Sewing Machine

Keynote address by Mr. Mark Newton, Environmental Officer, USAID

Most of the development solutions especially those aimed at improving the lives of the poor in the vulnerable segments are developed in a localised setting, so how do we scale them up?

Two kinds of definitions, neither optimal on it’s own.

  1. Custom designing solution
  • factors in local variables, particularities
  • innovators devise solutions for a specific context or clients.
  • Takes more time and careful consideration.
  • This model rarely generates the efficiency or economies of scale
  1. Replication
  • maximizes the economies of scale
  • makes more sense from a cost-perspective.
  • Trap of local solutions being  transferred elsewhere, with little consideration of the context. Fear of missing out on imperatives of the end-users.

Combining strengths of above mentioned categories, third category

  1. Efficiency core
  • Is the solution / aspect(s) of the solution that have worked
  • The critical part of the entire solution that we can replicate with minimum modification by adapting it to the local contexts.
  • Example of successful mass-replication: Sprinkles Global Health Initiative (micronutrients intervention scaled up to 6 countries)
  • The replicable efficiency core of this project was inspired by the packets of ketchup at fast food  restaurants.
  • Pre-made, single, serve sachet which can easily integrate into the highly ritualised practices of daily food preparation anywhere.
  • Sachet size standard, micronutrient contents inside vary according to local needs. Eg: Vitamin E in Mongolia
  • Localised packaging for reduced costs; use instructions in local language, local artwork on sachets.
  • Sprinkles are adaptations, not custom designs

It’s not about how to bring good ideas to scale but rather what parts of the good ideas to scale.

Panel Discussion

Panelists (Mr. Samit Ghosh, CEO & MD, Ujjivan, Mr. Satyan Mishra, Co-founder & MD, Drishtee, Ms. Sumita Ghose, Founder & MD, Rangsutra)

Mr. Samit Ghosh:

  • Wanted to start a financial institution that provided financial help to  6 million (or so) under-banked people- that would unlock a different sort of growth for the nation
  • how we define financial inclusion? all financial services which a segment requires is provided- loans, deposits, investments, insurance etc
  • 1985 onwards- financial inclusion for middle class started- and I noticed the impact and how the middle class life changed- also the impact on indian economy
  • Grameen Trust- you could apply for financial and technical support. Turned to them for exposure and understanding of microfinance
  • Met with Vijay Mahajan- leader of MFI in India (of BASIX in Hyderabad, India), attended their board meetings, went to their field offices in Raichur
  • Met Sanghamitra’s- Al Fernandes- spent a month to understand MFI with them
  • Unlike in commercial world, where it is very competitive, in the MFi industry there was a lot of sharing of knowledge and experience. Interest was also not narrowly focussed on how successful Grameen Bank, BASIX or Sanghamitra was going to be, but on developing an industry. There was a place for competition, and a place for cooperation and learning
  • Culture has always been sharing success and success transfer
  • Ujjivan follows the same policy- processes around technology, product, HR management- that’s an ongoing replication process

Ms. Sumita Ghose:

  • founded Rangsutra with 10 other people who worked in the area of rural arts and crafts
  • Early professional life- discovered strengths of rural communities in India
  • Rangsutra is an attempt to create an organization which ensures sustainable, regular employment, fair wages to artisans where they are- out of their homes in the villages
  • Early on we realised that if we wanted to cater to a certain market we needed to standardize certain processes- dyeing of fabric, dyeing of yarn, tailoring (sizes of garments- s/m/l).
  • Investment was needed in product development.
  • Craft has become decorative.
  • When customers were far off (if artisans weren’t in cities or not exposed to haats), they could not get proper feedback.
  • Product development continues to be one of the key aspects which is replicated wherever we work – products for global citizens. Mostly people who can afford to buy handmade products are not in villages
  • Crucial decision- wanted rangsutra to be a for profit organization – People had to have a stake in the program.
  • started with 1000 artisans who put in 1000 INR each -> 10lac capital. Sumita put in 10lac from her side
  • Continue to encourage artisans to become shareholders in the company (even when moving to other states)- if not from the start, later on as they associate themselves with Rangsutra and get orders.
  • Currently 2200 shareholders. Rajasthan, Eastern UP, Bengal, Manipur -> Challenges vary depending upon geography and craft weaving different from embroidery
  • Went for a wholesale route- worked with retailers. Got orders but unable to fulfill them. Invested in the beginning on creating cadre of people- ‘craft managers’- artisans from villages who have passed at least class 5-8- rangsutra trains them (classroom and on the job) on how to handle production and quality
  • Rangsutra challenge: how do we combine social and economic goals (respect for both producer and customer- a philosophy derived from Amul)

Mr. Satyan Mishra:

  • Developed Gyandoot- website for e-governance.
  • Ended up developing intranet software, for the Chief Minister to press the button, clap, do the inauguration that took me to the village
  • I was surprised at the enthusiasm of the people for a simple technology.
  • Thought we were fooling everyone, getting a mail of 5 lines transferred from a village to a district headquarter was so simple.
  • But, the moment I went to the village, I realised the value of the very simple application.
  • If that simple application can solve problem, there can be so many more things that could be done.
  • Started looking at social aspects of technology.
  • From 2000-2003 we got a lot of awards, were on top of the world  believing that we solved problems.
  • Good part was that the Government started to take active interest. They set up the e-governance cell in the ministry of Information technology. It focussed on providing Government services at village level. But the moment someone is replicating this, my interest ruined. Why should I be there where the problem is already being solved
  • So I started to think what was the next thing? I had over 100 entrepreneurs & I had to look for an interesting activity for them.
  • I started looking at computer education. I had the computer, had an entrepreneur, had a trainer by then who had more technical knowledge than me. I started to think why can’t he/she provide basic computer literacy to people there.That started to work and basically the model started to work. In terms of expansion, I didn’t need an MOU nor did I charge any money from the Govt to a  get to new village.That took us to places in Assam UP & Bihar. In 2006 we had 1000 such centres, investments poured in and I became a true entrepreneur. By that time Ashoka had given me a social entrepreneur tag.
  • But I realised that
  • There were people still living in poverty facing challenges, people still moving out of the villages at a pace too rapid that the villages cannot sustain themselves.
  • This changed the course for me as an individual. But for my organisation, it was much more difficult to change. An organisation is large truck which cannot be steered easily and has little turning radius.
  • It was no longer about what the world has to offer to the village, but it was about what the village needs from the world outside.
  • It is a very small differnce but it means a lot to the communities. I was considered as the last mile in delivering products. By 2008 we set up a supply chain of delivering FMCG products. When the village starts looking at you as the first mile like what Rangsutra is doing and you really become a part of the community, representing the community & not the world who is looking to push products, services, communication, materials or even Governments programs and schemes. The moment community starts expecting from you, the entire game changes.
  • The new game that we have been playing in the last 6 years has not won us many awards, but every smile that we see on the faces of the villagers is a big award.
Q and A with panelists:

Audience question: Connecting livelihood interventions to the market is a challenge when your core competency is solar. Connecting to a market may not be the expertise of your organization so how do you handle building that ?

Answered by  Ms. Sumita Ghose

Early on, at Rangsutra, we learned not to expect villagers to know what type of garments to stitch. So we decided to take on product development, design development, and marketing. The organization has decided to look for markets and connect producers to the chain which has worked in the long run. Not everyone you will work with will be connected to all your markets, but you will figure that out.

Audience question: Best Practices Foundation trains participants to find a market themselves and then start a business. In the history of encouraging livelihoods, different organizations have failed, and even BPF has failed, because the people working on the issues have not understood how to connect the livelihoods projects to the market. Which is why when you put knowledge in the hands of villagers, they can create sustainable businesses.

How have you developed small time entrepreneurs while you stay in their local context? How have you managed to get people to create sustainable businesses? entrepreneurship

Answered by Mr. Satyan Mishra

Point: Initially there is “them” (villagers) and “we” (experts. “They” know how to produce and “we” know product and marketing. Them and we should fuse –the expertise that exists should merge. By doing that the general expertise and learning is increasing.

Answered by Ms. Sumita Ghose

We have encouraged women producers to participate in selling at exhibitions and retail outlets. 8-10 women from their villages visited a Fab India store and found products they made on the shelves. During the debriefing, I anticipated the question “I got Rs 200 and they are selling it for Rs 1000.” The question did come up – but the main thing that surfaced was the notion of “now we know that our product is going to such a lovely place and people are paying so much for it – so we want to do our best to make a beautiful product.”

This is also an opportunity to teach the women about the whole business cycle and to appreciate the roles of the other players have and the costs associated with getting the product to market.

Audience question: As a young organization, how do you know when to replicate/ to scale? If you are figuring your organization out, and there is demand for it, how do you know it’s time to share for different contexts? When did you know you needed to replicate?

Answered by Mr. Samit Ghosh

Point: Running a pilot and understanding that the model worked help us set the path for rolling it out nationally. Once you have a model straight and you understand the market that you are going to go – the most important thing is human resources. You need to build a team for your local context. Ensuring you have those people set will help you expand your reach and evolve your model.

Answered by  Ms. Sumita Ghose

For the first five years we thought we didn’t need to grow. But, when we looked at wanting to impact rural livelihoods we knew sky’s the limit. (Villagers) have an amazing skill –it seems a shame to not take their skill to the next step, especially since there is a great demand for the products they are creating. So we decided to grow.

Answered by Mr. Satyan Mishra

Spend time to make your product simpler. Ideas are simple but implementation becomes complicated. From a pilot you can understand what to do away with. If your product is simple, you can replicate. We have worked with franchises – with 10K entrepreneurs, if they can understand the business then it is ready for replication.

Audience Question – Rangsutra started off in Rajasthan and then replicated to Uttar Pradesh. What of worked in Rajasthan was standardized and immediately taken up in the next location and has the replication cycle become shorter/more efficient based on the learnings from previous replications?

Answered by Ms. Sumita Ghose

Point: Yes definitely. Product, design, training of rural women on enterprise and leadership. In fact in Rajasthan, they had built on work that had already been done. We are seeing that it is taking less time and costs to replicate but they are facing new challenges. Like now distance for some locations is challenging.

Answered by Mr. Satyan Mishra

Point: In the franchisee model – things have to become more and more simplified for it to implemented at scale. Have piloted 26 models so far and are a graveyard for failure. Only 5 or 6 have achieved scale.

Answered by Mr. Samit Ghosh

Point: Have had experiences that show that different markets have different characteristics. Have to adopt models. In microfinance in different places is so different – they work at different paces and have different issues. It’s not like McDonald’s. In entrepreneurship – with the urban poor – 70% of customers are self-employed business people and the bulk of their business is within their own community. All we have to do is provide finance and allow them to scale up. The variety of enterprise that is there already exists – just needs financing.

Follow up  – Said you wanted to learn from the best models. The best models have different aspects. You chose and have chosen to stay out of the livelihoods business. Can you give a reason why? Is it too complicated? Or that you can do so much more in financial services because inclusion is so low?

Answered by Mr. Samit Ghosh

Point: Our core competency is finance and that is why we stuck with it. Have a foundation that undertakes financial literacy activities and feel that the bandwidth dedicated in that area. With the urban poor, their entrepreneurial ability is outstanding.

Audience Question: Should organizations replicate only in terms of what they are doing or increase their bandwidth to serve much more of what mass parts of the country needs.

Answered by Mr. Samit Ghosh:

We are sticking with finance. We started with group lending but as we move up we find a missing middle ie. micro entrepreneurs who don’t have access to finance and who will not take group loans  and that’s a huge segment and we are trying to move to that segment and we are trying to move into that space. Debt only financing because we don’t have expertise in venture capitalism.

Answered by Mr. Satyan Mishra:

We decided to stick with communities. Over a period of time we have tried to become a platform for successful models to come and expand their reach in the villages that we serve. I think that maybe our expertise can be researched, I was amazed to see as to how selco is trying to do that and is a smart and timely thing to do, is to see how the expertise of a social enterprise that has to deal with a lot of different types of issues, like dealing with government, to ensure that their learnings are reaching out to every other organization which is a very smart thing to do. It’s an expertise issue at this moment we don’t feel we have that expertise to go beyond and for example work with the planning commission is not something we have the expertise to do as of now. There are some who can perform that role better who can consult and then there are others who go back and work with communities to solve critical problems.

Audience Question: You are all dealing with tangibles e.g. textiles etc have any of you had to deal with intangibles like we do with reading?

Answered by Mr. Satyan Mishra:

We all deal with tangibles also there is no way a tangible element can be offered to a ready customer if customer is not the same way as defined in MBA books then you have to mix a lot of intangibles around it. If reading is something you are promoting you have to have books. like livelihood generation and training.

Question goes back to how do you promote the intangible and how do you manage to get paid for that

Answered by Mr. Satyan Mishra:

The business model doesn’t assume you get paid for each element of the delivery product but something that is a suitable distance from the first activity that you engage in.

Answered by Ms. Sumita Ghose:

The organisation is a community owned model but the rich craft heritage is intangible. Story and a share certificate being framed and the lady knowing exactly the value of it because that was the only asset that she owns. gives her a sense of identity and purpose

Answered by Mr. Samit Ghosh:

Financial literacy model done by foundation and grants are needed for that but people started seeing the value in it even though it was free and now are even willing to pay for it. We also have 2 15 minute soap operas about a real life story of a lady who gets into debt by over borrowing and also one on ghost lending and the kind of problems that are faced bc of that. We not only show our customers but give it to partners worldwide and have translated to 14 Indian languages. But this needs grant funding.

Q: With small entrepreneurs you can see ideas can replicate themselves really quickly and how has that been tapped into and how have we learned from that?

Answered by Mr. Samit Ghosh:

That has actually been a problem for us with multiple people starting bangle stores or beauty parlor in the same area and I’m not sure if that actually is helpful and we don’t know how to control it.

Answered by Ms. Sumita Ghose: We have a happier store of women who had to come for long training and leave their homes for long durations but the spin-off from that has been incredible the women would go back to their villages and word would spread and it improved morale about the work that they are doing.

Audience Question: Organizing is the basis for our enterprise, I think its the hybrid of the work for social justice and a livelihood element should work together and is that true in your case? When you first start working in new communities how have you built credibility and trust of what you’re trying to do. And is that something you factor into where you replicate? Have other partners reached out to you and has that helped you decide where to replicate.

Answered by Ms. Sumita Ghose:

In our case we have responded with people coming to us and wanting to be a part of this and we see how it goes from there.

Answered by Mr. Samit Ghosh:

Credibility and trust takes a long time. We also use the success transfer model there. If we’ve worked in a town for sometime and customers are happy and many of them come from villages and we take them and ask them to share their success stories. Like what we call evangelical marketing.

Answered by Mr. Satyan Mishra: For us we are good at a hybrid model. On one end where there’s clarity, product, business model, people who understand the product and can deliver and funding that is attached to that product. Investors understand a product based business model than a need based model. You either start from the product or the community which is a major decision. If you start from the product, it should be simple, replicable something you can take everywhere but don’t think you will make social impact. But if you start with the community the challenges are much more but then you’re completely grounded and your relationship with the community is guaranteed. The business model might not work but in time you will get there as long as the costs are low.

Panel discussion summary: In Spite of being around for 10-20 years many of us have not formalized the replication process. We have been open and let people come learn from us but have not formalized it and this is something we can start articulating.

As long as we are open to absorb ideas from outside and to be able to offer ideas to the outside then replication and adaptation is possible.They have been able to analyze things from outside and see what is replicable and practical in their context and do that. Replication is not imitation we have to learn that there are certain things we can reject or keep and that’s an important capability that we should develop.

Day 2

Expert Talk: Mr. Biswanath Sinha, Associate Director, Tata Trusts. Presentation here.
EXPLORING VALUES– Session conducted by Dr. Veena Joshi, Consultant-Energy and Development. Presentation here.
  • Rethinking is associated with re-looking at some of the values that we live by
  • Introduction to value audit – a nine step process. PPT here.
  • What change in the mindset is required
  • Ms. Susmita(Pushaan, MP) mindset change required: energy surplus to decentralised renewable energy ; from depending on/waiting for free electricity/grid- decentralised energy access, own asset, that’s paid for.
  • Mr. Russell: Need of the hour a shift to a pro poor paradigm in bureaucracy.
  • Ms. Sandhya and Ms. Suman from SWaCH team:
    • Segregation of waste into dry and wet, at the source, by waste creators
    • organize the service chain, such that the waste goes from the house to the recycle plant than landfill/dump
    • individuals working in waste segregation and disposal to be viewed as ‘service providers’ instead of just waste-pickers.
  • Mr. Dev from Mangaal change in customer’s mindset from cost consciousness to quality consciousness.
  • TFI + Meghshala team change from fixed mindset to a growth mindset in both teachers and students in education, change in society from being narrow-minded to broad-minded as a whole.
  • Pratham Books Team: mindset change they have seen is being from ‘closed’ to ‘open’
  • low priced book does not mean poor quality/value, low-cost yet open source and high value
  • Change of farmers’ mindset: from producers to entrepreneurs  and from chemical methods to organic ones.
  • Change in community mindset from wanting free water to having metered connection, consume wisely and waste less , paying for essential services instead for free, even if the fee is low.
Breakout session #2

Pratham Books challenges:

  1. How do we get children to read books?
  2. How could we reach more children?
  3. Biggest challenge was cost of books and the overheads such as transportation costs involved shipping books to places like Manipur. This is something we are constantly thinking about.
  4. Lack of Feedback Mechanism:
    For participating children: How do we ensure they were reached, had a good time, learned something? The quality of storytelling?
  5. For volunteers conducting session: did not report back as to how they found the event/ session they conducted, citing busy schedules.

BEST PRACTICES FOUNDATION challenges
MOVE course: Business Education for the Illiterate Poor

  1. Identifying the market for the produce generated by communities who receive skill based training.
  2. How to explain marketing concepts to rural women
  3. Fundraising for the program
  4. If we want to replicate this in other areas- we do not have trainers. Creation of trainers is a big challenge

SWaCH challenges:

  1. This is a cooperative formed by waste-pickers and they will contribute 5% of their income towards running of the organisation. To an extent this is happening, but it is an internal challenge that not all waste-pickers are paying this 5%.
  2. Half of Pune is yet be covered. The installments of administrative charges were never paid to us on time and because we couldn’t cover full Pune, PMC have refused to pay the last two installments.
  3. Waste collection takes place on a hand-drawn push cart. So the push cart and the collection bucket is very important equipment. If we don’t get these on time, we cannot increase our collection reach/ coverage.
  4. In slums, recovering waste-collection fee of even Rs 10-20, on time from end-users is very difficult. So it becomes financially unsustainable for a waste-picker to work in a slum without collecting any user-fee from them. So PMC suggested that apart from whatever the waste-picker collected as fees from the slum, it would pay Rs 5/ household/month. And PMC has not paid this in five years.
  5. Gathering fees for waste-collection from shop owners in the commercial areas of Pune such as Tulsi Baug continues to be a challenge. Owners of commercial establishments expect the waste-pickers to ‘earn their fee’ out of money earned by selling of dry waste. How do you influence local corporators, who can in turn influence these commercial establishments to pay remains a challenge.
  6. How to structure costs in the MOU that can take into account unpredictable growth of the cities is yet another challenge.
 Mentor-Speak

Speaker: Prof. M. S. Sriram

Important question is to understand when we cut across sectors and disciplines, how do we distill the principles of RE-THINK and take it forward. It is difficult, because even when we wanted to abstract up from the deliberations, we tended to get into the details. Getting the message right will take many more such interactions.

Two important messages – (1) Patterns did emerge from the presentations, but they need to be tweaked to specific contexts. (2) We need to differentiate between recurrent processes and one time processes, though here we observed many recurrent processes.

Measuring the impact is important, but it is also important to document the process.

Speaker: Prof. Sourav Mukherji

The concept of for-profit enterprises has existed for over 150 years, but social enterprises are new. It is important to understand the differences in structures and motives. Social enterprises are a very Indian (developing country) idea, and we need Indian academicians to study this.

All of the idea of scaling is coming from for-profit commercial enterprises – that we need to standardize in order to scale, and that customization makes it hard to scale. This might not hold true for social enterprises, the services offered and the business models need to be studied.

Speaker: Mr. Hari Natarajan

The business model canvas used in the workshop has a specific purpose – to quickly sell the idea to investors in a simplified manner. The output of the canvas in this particular workshop was not clear. Was the idea that the challenges identified would be matched up to a solution from another canvas? The main challenges that came out were softer ones like how to manage the government, financiers, etc. But the solutions everyone came up with were around how to measure impact and developing training manuals. The initial idea of finding a match did not come through. Facilitation could’ve been better, perhaps now we can help you all connect to each other better so that there can be continued engagement.

Speaker: Mr. Nilanjan Ghosh

Upon traveling among the incubatees, we found that there was a lot of learning and certain processes could be replicated, and that’s where this idea started. Here we learned that replication can happen not only across organizations, but also across different sector and value chain. SELCO provided a good platform and hopefully CLEAN can take this forward.

Audience feedback:

  • Breaking out processes down and identifying challenges in different segments was helpful.
  • Activity of filling the canvas on Day 1 could’ve been a group exercise that would’ve resulted in more cross sectoral learning, instead of being an individual activity.
  • Facilitating continued engagement with other organizations will be helpful.

Workshop wrap-up session

  1. Aspects that people required more clarity on/ need to be clarified in initial sessions for next time:

Session/Overall goal perspective:

  • Why is SELCO doing this?
  • May have been better to create group exercises where all are involved in one replication canvas or exercises where more learnings are shared within each group.
  • Panel members could’ve spoken more about their challenges
  • While thinking about Replication, we should think both in terms of – Impact and Process replication (and be aware of both these while discussing)
  • How do we keep these conversations going?

Operational perspective:

  • Role of Mentors need to be clarified better
  • What was the relevance of using groups for the Replication canvas?- Any logic to how the groups were chosen
  • Having a video or a live case study to explain/complement the canvas would have been better.
  1. Positives of the workshop/ Aspects that people appreciated:
  • The canvas exercise and breaking the project up into the different stages/components was useful
  • (similar to above) The tools used were interesting – helped re-look at projects and dissect them
  • Was helpful in changing views on scaling and customization
  • Helped realize the need for improvements in documentation.
  1. Negatives of the workshop:
  • Sector-wise grouping of individuals (for canvas activity etc) would’ve been better –> Filling in the canvas as a group exercise
  • Or possibly filling in the canvas earlier and spending more time on abstractions at the session itself may have been more useful/ better utilization of time.

Next steps that were suggested:

  • Synthesize learnings from the canvases of each organization
  • Bring 2 organizations together based on what is identified from their canvas (either challenges that are similar/ or replicable processes of one that can address the challenges of the other).

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